Mining is a great way to enter the cryptocurrency ecosystem. However, Bitcoin/Litecoin is almost impossible to mine for the average user. It requires expensive equipment called ASICs that are made by a controversial, centralized company called Bitmain. These ASIC chips consume high amounts of electricity, and ASIC mining farms often use cheap & ecologically-destructive coal power. These centralized mining cartels mint the vast majority of new Bitcoin, and are responsible for contentious forks of Bitcoin in order to maintain a monopoly of the network.
I am not trying to cast a negative light on Bitcoin- I am highlighting how far we have come from Satoshi’s (the mysterious creator of Bitcoin’s) white paper that described a democratic mining system of “One CPU” as “one vote.” Back in the early days of Bitcoin, any old laptop could mine hundreds of Bitcoin a week (worth millions of $ at today’s value). In a way, this was utopian in the sense that anyone, anywhere could verify and support Bitcoin’s network. However today, CPUs and even more powerful GPU’s are worthless for mining on Bitcoin’s network- which leaves all of the mining to one powerful mining company in China.
Monero has an interesting feature that allows CPU mining to always be competitive, no matter the size of its network. This feature seems to fulfill the original intention of Bitcoin for “One CPU, one vote.” Therefore, it is possible to mine Monero on ANY computer. A user-friendly website that I have used to CPU mine Monero for the past year is called Minergate. Make an account, download the software, and turn on “Extended Mode.” I prefer to turn off the “Smart Miner” and instead only mine XMR (Monero) as I believe it is the best coin they offer.
If you leave a spare core, you should have no problem doing most tasks on your computer while simultaneously earning passive mining income. It depends on your equipment, but if you have a decent CPU you can make a reasonable income as long as your computer is on and running. Every month or so, Withdraw your earnings to your favorite altcoin exchange and either a. Hodl your Monero or b. Sell for Bitcoin.
This past year I have continuously sold most of my earned Monero directly for Bitcoin. (I have actually missed out on greater gains with this method as Monero has gone to the moon, but I probably will continue this way)
Next Option: Mine Zcash/Eth with GPU
This is slightly more restrictive, as not everyone has a suitable AMD or Nvidia Graphics Processor so I will not go into too much detail for this one.
I personally mine Zcash and sell every week for Bitcoin or other interesting cryptocurrencies. I prefer to use Suprnova pool. Minergate also offers GPU mining if you like their interface better. Here, Suprnova offers a detailed guide for how to get up and running. Zcash is another anonymous coin similar to Monero. *(Update: ASICs will now soon be available for Eth/ZCash, so GPU mining may soon become obsolete)
If you want to support Ethereum’s network instead of Zcash, check out eth.suprnova.cc, although it is a slightly more involved involved process than Zcash.
Final Option: Mine Storj with Hard Drive
An interesting idea that has come from Bitcoin, is to distribute file storage on the blockchain like Bitcoin/Ethereum does for computing power. As such, it is possible to use extra hard drive space to “mine” and host files on decentralized storage networks like Storj, Sia, and Filecoin. Filecoin looks to be the most exciting of the three, but unfortunately it is not live yet. Therefore, I mine Storj with my hard-drive. (Sia is legitimate as well, but very unprofitable at the moment as a host)
Apparently, Google is an investor in Storj, and while it has had growing pains, I am bullish on Storj going forward. On Mac it’s extremely easy to set up Storj and start up, but it is a little more in-depth for Windows users:
Click “Rent Your Drive” and follow the steps to download.
First step after opening the app is to enter your ERC20 token address:
Get that by “Creating a New Wallet” on MyEtherWallet and following the instructions to copy your “0x” ethereum address like the one above.
Enter this address in Storj Step 1, then move on and choose a folder to host your rented HD space. Follow through the steps, and the default setup should work for most Mac users no problem.
If you are a Windows user, you need to do two extra things. 1. Sync your time clock with the nearest server, as described in 3.1 in this Storj guide. Next, you need to make sure you chose an Open Port, as described in 3.3.2 of that same guide.
It will take weeks to fill up all of your space, but a few GBs worth of rented space can still yield profits.
Helpful tip: also remember to make sure your computer doesn’t go to Sleep, if you want to consistently mine.
Conclusion
While some of these mining processes may sound confusing and probably won’t make you a millionaire, I think mining is a rewarding way to explore the crypto-ecosystem. While some people call Cryptocurrency a bubble, I believe it will one day become an important part of the world economy.
Furthermore, I think that a few dollars worth of Cryptocurrency today can grow into a lot more in the future. Whether you hold these CPU, GPU, and HD-mineable coins, or simply sell directly for Bitcoin on your favorite exchange, I believe that you will ultimately thank yourself later.
To read more about Bitcoin and its role in the global economy, check out my latest story here.